January global food price hits 3-year low

The January global food price index fell further by one percent, the lowest value in nearly three years, according to the Food and Agriculture Organisation (FAO) latest food price index report.

The FAO’s global food price index report released Friday showed that January’s global food price index, which averaged 118.0 points, declined by one percent from December 118.5 points, making it the lowest value since February 2021.

The global food price index, which tracks changes in the international prices of a set of globally traded food commodities, is led by the decrease in prices of cereals and meat, which more than offset an increase in sugar prices.

“The FAO meat price index declined for the seventh consecutive month by 1.4 percent from December, as abundant supplies from leading exporting countries drove down international prices of poultry, bovine and pig meats,” the report stated.

“By contrast, international ovine meat prices increased on high global import demand and lower supplies of animals for slaughter in Oceania,” the report said.

The meat price index averaged 109.8 points, fell 1.5 points from December 111.3 points, and dipped further on a year-on-year basis, from 131.6 to 118.0 points, in January 2023 and January 2024, respectively.

On a year-on-year basis, the January food price index was down 118.0 points from 131.6 points in January 2023.

This decline in the food price index report further eases concern over global food price inflation.

The agency’s sugar price index showed the most increase with 135.3 points from 116.8 points in January 2023. It also increased 0.8 percent from the previous month, hinged on concerns over the likely impact of below-average rains in Brazil on sugarcane crops to be harvested from April, coupled with unfavourable production prospects in Thailand and India.

The sugar price index, however, had declined 16.6 percent in December last year from November.

Cereal prices declined 2.2 percent from the previous month and fell 18.6 percent from their previous year’s value.

Wheat and maize fell sharply on a month-on-month basis driven by strong competition among experts and the arrival of recently harvested supplies in southern hemisphere countries.

The decline in maize reflects improved crop conditions and the start of the harvest season in Argentina and larger supplies in the U.S.

For the year as a whole, cereal prices were 15.4 percent below their 2022 average, reflecting well-supplied markets, although the FAO’s All Rice Price Index, which is a part of the FAO Cereal Price Index, increased by a further 2.1 percent, largely reflecting a rise in prices of higher quality India’s rice due to strong pace of Thai and Pakistani shipments and additional purchases by Indonesia.

The vegetable oil price index dipped by 17.8 percent below its 2023 corresponding month and averaged 118.9 points, virtually unchanged from December’s value.